president obama heads to the site of the boston bombings. in today's cover story, a check-up on abbott labs. is the spin-off bringing re-newed health to the drug company? plus, why cupcakes are falling out of "flavor" with consumers. and investors slice off large chunks of apple, leaving the stock trading barely above $400. first business starts now. you're watching first business: financial news, analysis, and today's investment ideas. good morning. it's thursday, april 18th. i'm angela miles. in today's first look: stocks run into tumble trouble. unable to attract a steady stream of investors following dissapointing earnings from bank of america and concerns about apple, the major indicies all fell wednesday, with the dow cooling off 138 points.

gold pushed back $14 and oil dropped $1.99 on concerns about soft demand. ebay and american express fell in the after-hours session on mixed earnings results. among the highlights, ebay's forecast was lighter than expected and american express revenue fell short. and according to the beige book, the fed sees moderate growth in the economy led by sales of homes and cars. todd horwitz of averagejoeoptions.com joins us on this thursday morning for a good look at the market. good morning to you. - good morning angie. - fears are rising out there. the volatility index, the vix, made a big spike this week. what is that telling investors and traders? - i think what you are looking at here angie is the markets are starting to turn over a little bit. we had a little sign that volatility was going to increase as the bond market was going higher, as the equity markets, the stocks that were

being bought were more in the defensive sector. so now finally options are being bought instead of sold, though we are now getting a little bit more fear here in the market, and that is what we are signaling. we are seeing the market possibly changing directions and this 1550 level in the s&p is going to be real key. if we goes significantly below there, we should have a real good sell-off. - todd, who is losing money as gold goes lower? i know central banks might be losing money, and even some of the hedge funds. - a lot of the big hedge funds i know, paulson has a lot in the market here, and a lot of the funds, a lot of the gold- bugs, are obviously losing a lot of money here, because gold is - as i have been saying for years, it's just like any other commodity: it trades, it goes up and down, and it is not a safe haven. barclays came out with a call yesterday telling people to put their money into safe havens. they say it is time to look for stocks that act like bonds. what are some names that you would want to buy? - my personal opinion is these

markets are slightly overvalued here. they are looking at the johnson & johnsons of the world, colgate, verizon, mcdonald's. all the safe stocks, the everyday need stocks that are going to do business no matter what. that is what they are looking at. but those talks are a little overvalued. that was really the first tipoff that the market was looking to sell, because that is where the money was going, into some of those safer havens, as i like to call them. - mcdonald's recently had an all-time high. would you want to buy at those levels? maybe, maybe not. - no. - that is a big no for you. thanks a lot, todd. - thank you, have a great day. president obama goes to boston today. he will attend a memorial service for victims of the boston marathon explosions. the governor of massachuettes is asking for vounteers to donate blood, and the irs extended the tax deadline to july 15th for taxpayers in massachusetts and others involved in the tragedy. meanwhile, in washingto, a scare wednesday as mail screeners intercepted a suspicious letter sent to president obama one day after a similar letter potentially laced with poison was detected before it reached mississippi senator roger wicker. but it's the president's speech last evening from the white house rose garden that's also generating interest

today. using strong language, he lashed out at gun lobby groups for causing the failure of a senate vote to expand background checks. the president adds polls show roughly 90% of americans support better background checks. the nra calls the bill "misguided." investors are buying shares of a supermarket stock by the cartload. fairway market, a popular grocery chain, opened for trade on the nasdaq yesterday. even as the nasdaq dropped 60 points, the fairway ipo popped 33%. fairway shares priced in at $13 and closed at $17.35. the company is raising money to open new stores in new york, new jersey and connecticut. in our cover story, abbott labs did very well in the first quarter, much of it due to the pharmaceutical company's work in emerging markets. but, the portion of abbott that split off, called "abbvie" - not so well. layoffs are coming. first of all, there are now two abbotts. the company split in january. abbott labs, which

sells nutritional brands, diagnostic products and stents for heart patients, and abbvie, which is mostly pharmaceuticals such as anti-inflamatory drug humira. the first one, abbott labs, did well in the first quarter - more than $2 billion in sales came from emerging markets. "for abbott, its future is in emerging markets. 41% of its first-quarter sales came from emerging markets, and we see that continuing." china, which is enacting its own health care reforms, is seeing nutrition and diagnosis of medical conditions on the upswing. "you have more people making more money, spending it on nutritionals and for more doctor visits, which plays into what abbott is offering." the other abbott, abbvie, says

it will lay off 1900 employees - mostly sales people - as the patent for humira runs out, clearing the way for generics, but before abbvie's next drug is ready for market. "what we've seen is the regulatory agencies get more conservative, and a shift among consumers not willing to pay for only slight improvements in new drugs." some good news for privately- held purdue pharma, maker of the pain killer oxycontin - the food and drug administration says generics will not be allowed to replicate versions of the pain killer in the form that led to abuse and sometimes death. kentucky congressman hal rogers says the fda's decision prevents a deadly tidal wave of abuse and overdose. bank of america reached a record settlement with investors. the bank will pay

$500 million to investors claiming they were misled by its countrywide unit into buying risky mortgage debt. in trading yesterday, shares of bank of america fell nearly 5%. the stock dropped on word of an earnings miss. although profits quadrupled from a year ago, shareholders remain concerned about future litigation against the bank. homeowners are having trouble cashing settlement checks from top banks. the money is to compensate for flawed foreclosures and is usually in the $300 to $600 range. 50,000 homeowners successfully recieved their money. owever, in some cases, the checks were rejected and could not be cashed. the federal reserve says the problem has been corrected. 4.2 million people are eligible for the payments. hitting the atm is becoming pricier. banks are charging higher fees for non-customers who use the atm. average charges are up 20% since 2007, from $1.75 to more than $2. some fees go as high as $5. banks are making more of an attempt to increase atm revenues due to

higher operating costs and regulations. carnival cruise lines is investing millions to "power up" its fleet. after several mishaps, including a fire aboard the triumph in march, the company will spend $300 million to upgrade 24 ships. additional generators will be added to maintain power capabilities. carnival's ceo assures that its ships meet safety standards, but that the company has learned from its experience with the triumph. "our products, our equipment, our policies, our procedures all meet or exceed all international standards as far as safe operation. having said that, there are always things you can learn from any incident, and certainly there are things we are going to learn from and we have learned from this particular case." cahill admits the triumph's emergency diesel generators did not have enough power to run toilets, elevators and water systems onboard.

on a related note, carnival is agreeing to pay back the government for the rescue of its ships. the cost to the navy and coast guard topped $4 million. a warning is out about life insurance companies and pension funds. the imf tells reporters public pension plans won't be able to fund nearly a third of future obligations, and pension funds and insurance firms are turning to risky investments and betting on large returns to cover funding shortfalls. the situation, however, is not dire - both groups have cash on hand. the postmaster general made a return trip to capitol hill. this time, u.s. postmaster general patrick donahoe told a house committee, the postal service is operating with a broken business model and losing $25 million daily. unless congress changes laws, donahoe predicts the situation will become worse. he suggests cutting saturday delivery and tighter controls on healthcare and pensions. more americans are warming up to the idea of renting. allstate insurance reports the

demographics for renters are changing: the median age of renters is 40 years old. roughly 60% of renters are over the age of 35. "we're seeing people move in to the renters market by choice. they like the flexibility that comes with renting, and they have some concerns about investing their money in a depreciating asset - that being a home - without any knowledge of whether or not we've hit a bottom in terms of real estate pricing." that was don bailey of allstate insurance. meanwhile, millenials are moving in to the role of home ownership. a growing trend also reveals many younger couples are buying homes before marriage. doll demand gave a lift to mattel's first quarter earnings. sales of american girl dolls and monster high dolls are strong. however, barbie sales slipped. the world's top toymaker also said global demand is up. the stock closed higher yesterday at $43. it is up 22% so far this year. the governor of texas is playing a high-stakes game with jobs. governor rick perry is on radio

air waves across illinois attempting to convince companies to leave the land of lincoln and head to texas. in one spot, the governor says: "i have a word of advice for employers frustrated by illinois' short-sighted approach to business: you need to get out while there's still time." illinois governor pat quinn tells the chicago tribune it's nothing more than a publicity stunt, and that companies are coming to illinois for its highly skilled workforce. cupcake fans are experiencing a sugar crash. the dessert is losing luster after years of popularity. case in point: crumbs bake shop. the cupcake chain, which trades on the nyse, is now warning of slower sales. its stock fell 34% last friday. no word yet on what dessert will next capture the attention of america's sweet tooth.

still to come, it's a movies and money thursday. find out if tom cruise still has what it takes to come in number one at the box office this weekend. but first, networks and cable channels beware: big changes are coming from small upstarts. that's next with bill moller.

you hear that? there's a shake- up going on in the television industry. a brash little upstart called aereo has the networks & cable operators running scared right now. brian tallerico is the tv critic for hollywoodchicago.com. why is this david causing so much angst and chaos among all the goliaths? - the goliath's already being attacked by other davids in the form of hulu and netflix, and now this one comes along, and it's such a shake-up. the courts have gotten involved in saying whether or not it is even legal to do what aereo is trying to do. - but they have been granted court permission to go ahead. - they have been granted court permission, the idea being that no restrictions were put in place when they said "hey, we can take these broadcast waves and watch them in our house, so if we turn them into internet traffic, that is ok too." - so what they are doing with aereo is they take the network signal and just rebroadcast and sell it, so they are pirating a signal legally somehow. - yes. pirating is such a weird word in this case. if you order a pay-per-view, and you invite your friends over and charge them $20 a piece, you might make a little bit of a profit. they are doing that on a massive scale. they are taking

something that is free over the waves, and the networks made that decision long ago, that we are going to be able to get tv for free - abc, nbc... - all of us are going to be able to get that for free. and then aereo built this giant infrastructure, these internet servers and towers and everything, to charge people for it, and to put it out there. - so what happens to network programming? are they going to disappear? is everything going to be cable? - i think it has to be. fox has already threatened that, that the only way out of this is to go to cable. because what happens is, fox sells an affiliate feed to local affiliates and to cable companies. no one is paying that fee. it's not the advertising. for hulu and netflix, the concern was advertising. "they're not watching commercials anymore." this is much bigger than "they're not watching commercials anymore," because no one's getting paid. comcast pays abc to have abc. if no one needs comcast anymore, then abc is not getting their money, and they will probably just have to go to some sort of subscription rate. i personally think eventually

everything is going to be pay- for-play. everything is going to be on-demand. you want to watch something on abc, you want to watch something on nbc, there will be content providers, and we will have to pay to see it all. - we are only in the middle of this whole period of transition to... - every day something new comes up. - brian tallerico. thanks so much. - thank you. still ahead, a banner weekend for the movie "42." who's smiling? warner brothers. that's coming up. this neighborhood sure has changed a lot over the years.

you know there was a time when people like me couldn't live here. i'll never forget being told i wasn't welcome in this neighborhood. well i own this building now, the fair housing act made a difference for someone like me. so i can choose where i want to live, free from discrimination. glad you could make it, right this way... the film chronicling the life of famed major league player jackie robison is a big hit at the box office. our movie man,

erik childress, is here on set. good morning to you. "42" knocking it out of the park over the weekend - had the biggest opening weekend ever for a baseball film. what's behind the success? - i think, one, you have a film that sort of cuts between both demographics. obviously this is is a very major story for african-americans, and you have baseball season starting. the promotion has been very good for the film, and all the baseball teams are talking about it. - what does this mean for warner bros.? - this is probably the first bit of good news they have had all year. they have had five straight disappointments at the box office. they are sitting on "jack the giant slayer," which was a giant bomb this year, probably the biggest we're going to see. but this was a modestly budgeted films - $40 million. it is still going to be a film that needs to make $100 million just to break even. so they are not out of the woods yet, and baseball films don't

traditionally do very well overseas, so this is a film that is probably going to have to make its money here in the u.s. - interesting. here is a look at what happened at the box office over the weekend: "42" coming in at $27.4 million. "scary movie" in the second position at $14 million, "the croods" at $13 million, "g.i. joe: retaliation" at $10 million, and "evil dead" at $9.4 million. coming up this weekend, "oblivion," starring- - tom cruise. - that's right. and morgan freeman. - and morgan freeman. this is another big science fiction movie, sort of the prelude to the summer, if you will - it comes out a couple of weeks before the big summer deluge hits us. and tom cruise, his last film, "jack reacher," only did about $80 million. if you look at tom cruise's career, although he has had a very consistent presence at the box office, of the last few movies, "mission: impossible," is really the only film over the last few years to gain and that sort of old-school tom cruise momentum. the other films on his list, "jack reacher" and "valkyrie" and "knight & day" have not hit $100 million. so it is going to be curious to see

how this film opens. - film studios are already gearing up for what they hope will be summer blockbuster hits. what do you see coming out of cinemacon that is going on in vegas? - this is the annual event that happens in vegas where studios get together and they sort of present their entire lineup to theater owners and say, "this is what we've got coming out. we have brad pitt, and here is brad pitt for you." so i think, obviously they have a lot of hope this summer, and over the next few weeks we will sort of look and see, break down sort of by studio what they have to look forward to, and hopefully maybe warner bros. can get out of their rut. is universal going to continue their streak with "mama," "identity thief" and now "oblivion?" we will see what they have coming up, too. so there are a lot of things to talk about over the next few weeks. - other than "hangover 3." - yes. though it'll make money, but it will probably be horrible. - thanks a lot, erik. have a good weekend. - thank you. coming up, investors are becoming 'very nervous' about apple ahead of earnings. the reasons, after the break.

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join the movement at drive4copd.com. take our screening questionnaire today, and talk to your doctor. oh, how the mighty have fallen! apple shares trading near $400. matt cavanaugh of cmz trading joins us now for chart talk. where is the bottom on this stock? - that is a really good question. the last time we talked about apple was the last time their earnings came out,

and i thought maybe it had a chance to touch $420 when it was all said and done. but i thought you would be ok on the stock. well, the stock to held $420 forever, and then yesterday you had a really kind of a poor report out of a supplier of apple, and that just sent the stock crumbling. so, really some interesting things going on with them. - but at what point do investors say, "$400 is better than $700. maybe i better buy the stock now?" - that is a good question, and the answer is usually too late. people are looking for clarification from apple. they want to know what is the new product going forward, what are you going to do with all this cash? give me something to work with. they're not happy with their management, they're not happy with their products coming forward, and they're not happy with them sitting on all this money. so, as a result, you see the stock getting punished, and i think that people really need some clarification, and the proof is going to be in the pudding when earnings come out next tuesday. - you are a pro trader. would you position ahead of those earnings?

- i think that the stock can go lower, but everything is telling me that it should be a buy. you look at it from a valuation basis, from the way the company is run, just everything about it, and you think, "gosh, how can this stock it too much cheaper?" but, that being said, it can. so, i would position myself to really try to take advantage of the volatility, and i think that is the play here. - trying to catch a falling knife sometimes though. thanks a lot, matt. - thank you. before we take off, a quick reminder not to miss the friday show: coming up in traders unplugged, the guys go toe-to- toe over making money on the possible sale of sprint. from all of us at first business, have a great day!